The Senate is set to test the White House’s commitment to lowering the corporate tax rate to no higher than 20 percent in the next few days, with multiple Republicans planning to offer amendments to the tax bill that would trade a slightly higher rate for bigger tax breaks for families.
Republican Sens. Marco Rubio of Florida and Mike Lee of Utah announced Wednesday that they planned to offer an amendment that would set the corporate tax rate slightly higher, at 22 percent, in exchange for making the child tax credit refundable against payroll taxes and available to more lower-income families.
Republican Maine Sen. Susan Collins also said she would offer an amendment raising the rate to 21 percent in order to restore some deductions for state and local property taxes.
Such amendments would test what administration officials have long said is one of Trump’s few “red lines” regarding the tax bill, namely the 20 percent rate. Trump himself originally favored a corporate rate of 15 percent.
Asked Wednesday at the Capitol about the Rubio-Lee proposal, White House legislative director Marc Short replied, “We like 20 percent corporate.” He then downplayed the conflict, saying “it’s not a veto question.”
Speaking to the Washington Examiner, Rubio said he doesn’t believe that Trump would veto a bill with a 22 percent corporate rate.
“I don’t think he would veto a tax cut because we’re giving tax cuts to working families,” the Florida senator said.
In fact, Trump himself appeared to take the threat of a veto off the table in a speech in Missouri Wednesday, telling the crowd that he would sign tax cut legislation that Congress put on his desk.
“I promise you, I will sign it,” Trump said. “I will not veto that bill.”
Collins suggested to reporters off the Senate floor Wednesday evening that Senate Republicans were not tied to 20 percent.
“I think it’s significant that many members believe that we don’t need to go all the way to 20 percent in order to spur investment and job creation,” she said. She added that CEOs who have lobbied her on taxes have said that there would not be a big difference between a rate of 20 percent and one a few percentage points higher.
Rubio justified settling for a 22 percent rate in a speech on the Senate floor Wednesday afternoon, noting that it would put the U.S. in the same position, relative to its peers, that the 20 percent rate would. And 22 percent would still be lower than the average of developed nations, he argued.
“It’s just as pro-growth, it makes us just as competitive — but it allows us to do the pro-worker reform we so desperately need,” he said of trading the slightly higher corporate rate for the child tax credit provision.
Lee and Rubio argued that, by making the credit refundable against payroll taxes as well as income taxes, it would benefit waitresses, truck drivers, and other working people.
“This is not a handout, this is not a welfare benefit,” Lee said. “This is money that they’re making.”
Rubio declined to say directly that he would not vote for the tax bill unless it included his amendment.
“We’re working on getting the amendment done,” he said. “We’ll see what the bill looks like when we’re done working on it.”
While Rubio said that he hoped that Democrats would support his amendment, even if they voted against the underlying bill, he has only heard expressions of general support for it, not any vote commitments.
